1 min readA U.S. Treasury plan to freeze payments for subprime mortgage holders fired up demand for Frannie Mae and Freddie Mac mortgage and agency debt on Friday, as it assuaged fears of massive loan defaults and helped erase yield premiums racked up in the last week’s panic selling. “The market was so pessimistic about the prospect…
6 min readBy: Michael Quint More than a year after 15 securities firms settled claims of manipulating auction-rate bonds, the $360 billion market remains as opaque as ever. Investors can’t get basic information about trading in their securities, like the interest rate. Qwest Communications International Inc. and Synaptics Inc. haven’t been able to unload the debt when…
1 min readU.S. agency and mortgage debt prices firmed but lagged Treasury market gains on Monday on widening subprime market worries that fueled demand for safer assets. Agency and MBS spreads expanded as Treasuries rallied on new lows in the benchmark ABX index, used by investors to hedge subprime mortgage risks. Investors are skittish even in the…
1 min readOver much the last decade, supposedly conservative cash investors steadily increasing their risk appetite was a widespread phenomenon. Recent credit developments in the mortgage and debt markets helped raise risk awareness levels. This paper summarizes the risk behavior of corporate cash and money market fund managers into eight broad categories. Corporate investors are advised to…
1 min readAmgen, Baker Hughes, Dow Chemical and a handful of other corporations with high credit ratings and sagging share prices have become leveraged buyout candidates. Observers say that as the prospect of higher bond yields and more expensive debt appears, certain companies with the best ability to sustain debt payments will look more attractive to buyout…
1 min readU.S agency and mortgage-backed debt yield spreads widened as both sectors trailed a Treasury market rally on Tuesday spurred by investors clamoring for safe assets on mounting subprime mortgage woes. Growing subprime lender troubles, rising delinquencies and foreclosures driven by loans made to borrowers with weak credit, and softer-than-expected retail sales data fueled talk that…